Alerts

SEC Provides Interpretive Guidance on Liquidity and Capital Resources Disclosure

Guidance Should Be Taken into Account in Upcoming Periodic Reporting

October 5, 2010

In mid-September, the SEC published interpretive guidance on disclosures in the Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) relating to liquidity, leverage ratios and contractual obligations. The guidance should be taken into account in upcoming filings, including third quarter 10-Qs to be filed by calendar-year registrants. The guidance was issued simultaneously with proposed amendments to existing MD&A disclosure requirements that would enhance the disclosure that registrants are required to provide concerning short-term borrowings. This Alert discusses action items and considerations arising out of the interpretative guidance.